Tension Over State Free Tuition Programs

on February 23, 2017

Some state free tuition programs limit free tuition benefits to state residents enrolled at community colleges. This shifts enrollment patterns and funding from four-year to two-year colleges, causing tensions between the institutions.

 

Free tuition programs lead to increases in overall college enrollment because the programs make college more affordable for low-income, underrepresented and first-generation college students.

 

When a free tuition program is restricted to students at two-year colleges, it causes shifts in enrollment from four-year colleges to two-year colleges. Critics say that this will lead to a decline in Bachelor’s degree attainment.

 

Similar tensions exist between dual enrollment programs and community colleges, since dual-enrollment programs reduce subsequent enrollment in two-year colleges.

 

Free community college tuition programs also can cause a shift in state funding from four-year to two-year colleges, since increases in free tuition programs often require reductions in funding for the state grant programs.

 

Need-based, state-grant programs are available to low-income students at all colleges, not just two-year colleges. The changes in the state grant programs can include reductions in the maximum grant amount and tighter eligibility restrictions, such as higher minimum GPA requirements and lower income limits.

 

The last-dollar design of state free tuition programs causes more of the benefits to accrue to middle- and high-income students than to low-income students. The financial benefit of a free tuition program is reduced for students who already receive gift aid, such as the Federal Pell Grant. Low-income students can’t use the Federal Pell Grant to pay for textbooks or living expenses, since the states require the money to be applied first to tuition costs.

 

Private scholarship providers also are concerned about free tuition programs, because the money displaces private scholarships for low-income students.

 

Some four-year colleges have lobbied their state legislatures to shift funding from free tuition programs to need-based state grant programs, since the state grants are available to all students, not just those enrolled in two-year colleges.

 

The competition from free tuition programs can put pressure on four-year colleges to establish their own free tuition programs for high-achieving low-income students.

 

Recent proposals for free tuition programs, such as New York and Rhode Island, have included both two-year and four-year colleges, thereby avoiding the tensions that arise from free tuition programs that are restricted to just two-year colleges.

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